AP Macroeconomics Unit 5

Front

When the government spends more money than they take in each year is called a _________?

Back

Deficit

Front

"The Fed" refers to the....

Back

Federal Reserve System

Front

what is the purpose of Monetary Policy?

Back

contribute to economic growth and stability

Front

These are IOUs from the U.S. government to people that finance a little piece of the government's debt in exchange for a very small amount of interest.

Back

Government Bonds, or Securities

Front

The primary role of the Federal Reserve Bank is to steer the economy by

Back

controlling the money supply.

Front

Cash that banks must keep in the vault.

Back

required reserves

Front

The exchange of goods and services without using money is known as...

Back

bartering.

Front

Which of the following would the FED use to increase the money supply? Options: raise the discount rate, raise the required reserves, buy bonds/securities, print more money

Back

buy bonds/securities

Front

Fiat money is

Back

money that is only valuable because the government says it is.

Front

If the Federal Reserve wanted to stimulate the economy (make it grow), they might: Sell Treasury bonds, Buy Treasury bonds, Spend more money, Spend less money

Back

Buy Treasury bonds